At the moment of the platform's launch we will have a strong audience of SNcoin holders and potential interest for making purchases at the exchanges. The average cost of the listing on second-tier exchanges is about 10,000 U.S. dollars. But exchanges like Kraken, Poloniex, or Bittrex do not accept unpopular coins for listing. A large number of coin holders will come in handy here, and so will an active discussion of the project among the crypto community.
All these measures will encourage potential investors to purchase a limited number of coins at the stage of a private offering (30,000,000 coins). A big investor, having received reliable information about the project and its organizers, will think of investing 0.1-2% of their portfolio into a potentially super-profitable project. In our case, this is the most efficient way, as a big investor will not sell off all their coins after they grow by 2-3 times, because they want to support the community's growth – and thus the value of the coin as well. The main mistake of projects that give preference to bounty campaigns and airdrops is that the numerous enthusiasts who have received tokens for free will sell them on the exchange at once after the end of the ICO. This decreases the value of the coin dramatically, causes panic among investors, and puts the stamp of sadness on the project.
Unfortunately, the emerging sphere of ICOs, which is not controlled by regulators yet, invents the rules as it goes along. Some ICO projects practice the following tactics:
- announce the soft cap of, say, 3 Million dollars
- use a script that will automatically create hundreds or thousands of controlled wallets. It will, using the developers' own money in the turnover, purchase tokens from its own project. Today nobody controls the creation of new wallets, which can be perceived by real investors as actual people
- this way, they fill their wallet (contract address) with mostly phony transactions, for example, in the amount of 1.5 Million
dollars – half of the soft cap. When watching these transactions on http://www.etherscan.io
, the investor will not think that these frequent receipts of funds are only the work of scripts
- showing how successful they are in doing so, they can collect about 100-200K USD from second-rate investors purely based on the "hype"
- one week before the end of the ICO, they declare that the soft cap has been collected (hence making it clear to potential investors that success is inevitable)
- they sell tokens to themselves in the amount of another 1.5 Million, announcing that 4.5 Million have been collected successfully (but having in fact collected only 200-300 thousand)
- after the end of ICO, having paid 20 - 50 thousand USD for the listing on several exchanges, they decrease the value of their tokens together with "bounty hunters," selling them for any possible price. As the expenses of the creation and technical implementation of many projects aren't high, the organizers don't hesitate to sell a part of the accumulated tokens for a knock-down price, hoping that eventually the coin will have its hype, and the investors will start investing dollars in it, like investing in Bitcoin.
As the funds have to be returned to the investors in case the softcap is not achieved, and huge amounts of money have already been spent on marketing, they see such manipulations as the only possible way out.
To avoid such a situation, we see the sale of tokens as a way to popularize the platform and not as a means to attract funds just to complete it. Therefore, we do not persuade potential investors to urgently buy a great number of SNcoins. We are going to continue working on the platform in any case, and the very idea of creating a platform for scientific projects with decentralized expert evaluation obliges us to be consistent and transparent to all parties involved.
We will use such forums as BitcoinTalk and Reddit, as well as social networks, including asking the existing and future participants in the project to re-post our articles and publications. We'll benefit greatly from meaningful articles on the http://www.medium.com
portal. We are not going to advertise our project with the aid of youtube bloggers nor in venues where the audience mostly consists of newbies to crypto investments.
My prejudice that Bitcoin and many other cryptocurrencies are merely pyramid schemes has not changed. But to be effective, the ScientificCoin platform requires decentralized experts, the great value of which I described in the previous article https://medium.com/@dvedenidov/scientificcoin-blockchain-platform-for-scientific-projects-with-decentralized-projects-valuation-227586e015e
. After we are broadly recognized, the ScientificCoin platform will become the foundation of the eponymous cryptocurrency, which cannot be ruined by currency rate volatility.
Having millions of SNcoin owners, we will reach the same critical mass achieved by well-known social networks, mobile applications and so on. The holders will use ScientificCoin to generate passive income (each project that has attracted financing via ScientificCoin pays a 5% commission of the raised amount, which will be annually distributed among the holders). The other platform users will earn money by working as experts or miners, doing socially useful work.
Perhaps the volatility of this cryptocurrency will be much lower than for most cryptocurrencies, since it will be more profitable for SNcoin holders who generate passive income to keep the coins than to fall for speculators' manipulations. Having these instruments, a participant of the ScientificCoin platform will not perceive a sharp drop of SNcoin's rate the same way they would a sharp drop of Bitcoin's.
When carrying on negotiations with scientists concerning participation in our project, I had to briefly explain the advantages of blockchain, to distinguish it from the negative image of cryptocurrency most mature users associate it with. The ScientificCoin platform could exist without cryptocurrency speculations, but we will not create a closed blockchain ( in which the token is not traded on exchanges) as we would not be able to use the advantages of frenzy, which in its turn will make the platform recognizable to those who like making money quickly on cryptocurrencies.
Undoubtedly, we are going to encounter legal issues, for that purpose we have created a cryptocurrency company in Switzerland registered with FINMA, which will handle all our crypto operations.